Get ready for the upturn, minister tells West Midlands business
Mar 27 2009 By Jonathan Walker
West Midlands businesses must look beyond the recession and get ready for the upturn when it comes, a cabinet minister has warned.
Skills Secretary John Denham urged firms to invest in skills and training so they were ready to make the most of opportunities when the economy grew stronger.
Mr Denham - who visits the region on Friday - said manufacturing and green technology will continue to create jobs and wealth in the West Midlands once the recession is over.
And he warned that businesses were more likely to survive the downturn if they continued to invest in skills.
Mr Denham said: “The first part of the visit is to just stress, in what are currently very challenging times, that there is a positive future ahead that will bring prosperity and will bring jobs.”
He said West Midlands could attract a range of industries, but focused on high-value manufacturing - which includes research, design and branding of manufactured products - and the development of new, environmentally-friendly vehicles in the automotive sector.
“We know that the downturn isn’t going to last forever, and that we have in this country the capacity to build the industries which will ensure that we are competitive, strong and prosperous in the future.
“I am coming to the West Midlands to stress the importance of high-value added manufacturing and low carbon technologies, two areas of real strength in the region.
“These are areas where jobs will be created in the future, but it’s not going to happen just because we want it to happen. We’re going to have to make sure the government, business, research, universities and colleges are all working together effectively, if we are going to make the most of the potential we’ve got.
Firms must invest in skills if they hope to survive the recession, he said.
“We know that in the recession of the late 1980s and early 90s that companies that didn’t invest were two and a half times more likely to go out of businesses. And we’ve ran a major campaign saying now is the time to invest in skills.
“This is business leaders saying it’s a bad business mistake to think that cutting back on skills training is the way to get through.
“Companies need to be more innovative, they need to be more productive, and skills training is the way to do that.”
Me Denham said the automotive sector would continue to be a major employer in the West Midlands.
“I think that most regions will have a number of sectors where they can plan to be successful in the future.
“I have no doubt that after the current economic difficulties are over, and even allowing for the challenges of global warming, which means our transport system will have to be much lower carbon in the future, there will be a huge demand for vehicles that people can drive round.
“And what we need to make sure is that the West Midlands is as well placed as it can be to come through and take advantage of that in the future.
“I’m sure there will be other areas of the economy, healthcare is one, that will also be very important.
“It’s not a matter of having all your eggs in one basket, just a matter of making sure that what you do, you need to do very well.”
But he suggested that the Government would be reluctant to accept requests from the automotive industry for more subsidies for short-term working, in which the taxpayer helps pay the salaries of staff working three or four-day weeks.
Mr Denham said: “Where companies do ask sometimes for wage subsidies, so you are not so much training as paying for wages, for small companies of up to 50 employees we will actually provide wage compensation to people who are releasing their staff to train.
“When you get to much bigger businesses, it obviously can become a very big bill very quickly.”
